We're looking at buying a different house and I'm hung up on the last sentence in this section. We're doing a contingent contract on the sale of our house. They're asking for a 1% escrow. I'm sure I'm reading this wrong, but if for some reason we fail to get financing would that cause us to fail to settle? The way I'm reading this the first paragraph makes it sound like if we don't get the loan to go through the contract is canceled. The second makes me think I won't get my escrow back. We are pre-qualified but I'm not to keen on risking the escrow if there is any chance of loosing it for something dumb. D. Financing Contingency and Application. This Contract X is (addendum attached) or __ is not contingent on financing. If this Contract is contingent on financing: (i) Buyer will make written application for the financing and any lender-required property insurance no later than seven (7) days after Date of Ratification; (ii) Buyer grants permission for Cooperating Brokerage and the lender to disclose to Listing Brokerage and Seller general information available about the progress of the loan application and loan approval process; and (iii) Seller agrees to comply with reasonable lender requirements. If Buyer fails to settle, except due to any Default by Seller, then the provisions of the DEFAULT paragraph shall apply.